Working Capital - Business Finance 123

Working Capital is the life blood of most small businesses. Access to working capital provides the ability to support and grow a healthy cash flow for your business. But what many business owners don’t realize is that working capital is all around them. So let’s take a look at just a few easy sources of working capital.

First, did you know that your credit card receipts can be a source of working capital? There are many small business lenders that will now purchase an amount of your “future” credit card receipts and in return you get working capital.

If your business has account receivables with other businesses, that too can be a quick and easy source of working capital. With this source of working capital your business sells the outstanding receivables to the lender and the lender gives your business cash for working capital now.

Does your business own equipment? Owned equipment can be turned into working through a small business loan called a “sale and leaseback”. Your business sells your equipment to the lender for cash, you then lease the equipment back from the lender for a monthly payment, and at the end of the lease your business owns the equipment again.

Many different types of business credit card are available. Some that can provide working capital because they can be used like cash or they can actually get cash. And others that help conserve working capital because they can be used instead of cash for items your business needs.

Another source of working capital is Micro Loans. These are fairly quick decision loans that are backed by the SBA and where lenders make more than just a personal credit score decision. The lender will also look at the viability of your business in order to approve you for working capital. Locating funding sources for all these types of working capital is easy. Simply click on search and you can match them for free. Or you can read more about these types of working capital below:

Capital Type

Capital Type Capital Type Definition

Micro Loans

These are working capital loans typically funded from $5,000 to $35,000 and used for any business purpose.

Credit Crad Receipt Advances

A cash advance loan up to a $100,000 that is secured against your regular occurring monthly merchant credit receipts. The loan is paid back via automatic deduction from future credit card transactions.

Sell Account Recivables

Your account receivables are purchased at a small discount and you get cash now.

Business Credit Cards

These loans are unsecured and usually do not exceed $25,000. Loan limits are based on your personal credit score and not your time in business.

Sale and Leaseback

Sale of an asset for cash, with a contract to lease the asset back from the funding source purchasing the asset. Sales tax can be an issue here with this type of funding.